The Brain as a Hierarchical Organization

Juan D. Carrillo and Isabelle Brocas

No 5168, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We model the brain as a multi-agent organization. Based on recent neuroscience evidence, we assume that different systems of the brain have different time-horizons and different access to information. Introducing asymmetric information as a restriction on optimal choices generates endogenous constraints in decision-making. In this game played between brain systems, we show the optimality of a self-disciplining rule of the type 'work more today if you want to consume more today' and discuss its behavioural implications for the distribution of consumption over the life-cycle. We also argue that our split-self theory provides 'micro-microfoundations' for discounting and offer testable implications that depart from traditional models with no conflict and exogenous discounting. Last, we analyse a variant in which the agent has salient incentives or biased motivations. The previous rule is then replaced by a simple, non-intrusive precept of the type 'consume what you want, just don't abuse'.

Keywords: Neuroeconomics; Dual self model (search for similar items in EconPapers)
JEL-codes: D82 Z0 (search for similar items in EconPapers)
Date: 2005-08
New Economics Papers: this item is included in nep-evo and nep-hpe
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://cepr.org/publications/DP5168 (application/pdf)

Related works:
Journal Article: The Brain as a Hierarchical Organization (2008)
Working Paper: The Brain as a Hierarchical Organization (2007)
Working Paper: The Brain as a Hierarchical Organization (2006)
Working Paper: The Brain as a Hierarchical Organization (2005)
Working Paper: The Brain as a Hierarchical Organization (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:5168

Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP5168

Access Statistics for this paper

More papers in CEPR Discussion Papers from Centre for Economic Policy Research 33 Great Sutton Street, London EC1V 0DX, UK.
Bibliographic data for series maintained by CEPR ().